DFLers say Minnesota shouldn't charge gas tax this summer as inflation hedge

Rising prices for gas, food and other necessities are confounding Minnesota policymakers who feel pressure from voters but have few levers to tame inflation.

ST. PAUL, Minn. (FOX 9) - Rising prices for gas, food and other necessities are confounding Minnesota policymakers who feel pressure from voters but have few levers to tame inflation.

Echoing calls from congressional Democrats, five Minnesota House Democrats on Friday said the state should stop charging its 28.5 cent per gallon gas tax between Memorial Day and Labor Day. The gas tax holiday would cost the state around $207 million, supporters said.

"People are really going to be hurting. This is a way the state can help," said state Rep. Zack Stephenson, DFL-Coon Rapids, pointing to the likelihood of higher prices because of global instability caused by Russia's invasion of Ukraine.

Like in Congress, a Minnesota gas tax holiday faces long odds because Republicans referred to it a "gimmick." It also faces opposition from some Democrats.

The prices of rent, groceries and clothing are all increasing, contributing to an inflation rate of 7.5 percent in January, the highest in 40 years. But lawmakers have little control over the prices of those items because none are taxed in Minnesota, making the gas tax a target.

If the state and federal government paused the gas tax, it would amount to a 46.8 cent per gallon savings for drivers. By comparison, gas prices have soared 82 cents a gallon over the past year, according to data tracked by AAA.

Republicans who control the Senate favor permanent income tax cuts and criticized the House Democrats' gas tax proposal.

"This is just another election year gimmick from the Democrats," said Senate Majority Leader Jeremy Miller, R-Winona. "The best way to provide relief to Minnesotans is with permanent tax cuts that result in more money in people’s pockets every single paycheck, week after week, month after month, year after year."

Democratic Gov. Tim Walz is open the idea, a spokeswoman said. But the top Democrat on the Senate Transportation committee, state Sen. Scott Dibble of Minneapolis, said Friday that he opposes a gas tax holiday.

The idea had been touted by the top Republican in the House as recently as December. That month, House Minority Leader Kurt Daudt, called for "a moratorium on gas taxes."

"To say that gas prices moving a little bit here or there doesn’t impact families, I take that very personally," Daudt, R-Crown, said at the time.

Friday, Daudt's caucus released a statement noting that three of the five Democrats proposing the gas tax holiday -- Stephenson, state Rep. Dan Wolgamott of St. Cloud, and state Rep. Dave Lislegard of Aurora -- voted in 2019 to increase Minnesota's gas tax.

That year, House Democrats and Walz advanced a proposal that would raise the state's gas tax by 20 cents over four years to fund road construction. It did not become law because of opposition from Senate Republicans.

Stephenson said the world looks different now than in 2019.

"Russia was not at war with Ukraine three years ago," he said. "We didn’t have the federal infrastructure bill in place three years ago. The world is very different. Right now our constituents are struggling because of this super high inflation that also didn’t exist a few years ago. We need to be focusing on how we can help people now, not re-litigating battles from several years ago."